Winding up Proceedings in Nascent Stage before HC can be Transferred to NCLT: Delhi HC [Read Order]

Winding up proceedings in nascent stage before HC can be transferred to NCLT, rules Delhi HC
Delhi high court - NCLT - National company law - laws - Nascent Stage - TAXSCAN

The Delhi High Court observed that winding up proceedings in nascent stage before the High Court (HC) can be transferred to the National Company Law Tribunal ( NCLT ).

The instant company petition has been instituted under Section 433 (e) and (f) read with Sections 434 and 439 of the Companies Act of 1956, seeking winding up of the respondent company – M/s. Greka Drilling (India) Limited, predicated on the non-payment of outstanding dues to the tune of US$ 723,193.03/- along with due interest.

It was stated that subsequent to the receipt of the purchase order, certain terms of the agreement as regards the charges of delayed payments were not agreeable to the petitioner company, and therefore, correspondence ensued between the parties and consequently, it was agreed vide e-mail that charges of 1% per month would be payable for delayed payments and liquidated damages were waived off. Thereafter, the respondent placed another purchase order, for the supply of casing material of a different specification, and said order amounted to US$ 199,466,50/-.

The counsel on behalf of the petitioner submitted that it duly supplied the goods to the respondent company as per the purchase orders and raised certain invoices against the same dated 29.12.2014, 05.02.2015 and 15.02.2015 for a total amount of US$ 818,496.58/-. Further, it is stated that except the amount of US$ 147,111.66/-, paid by the respondent company in instalments, and the last payment having been made in August 2015, the respondent company did not make any further payments. Thereafter, the petitioner company raised certain further invoices in respect of delay in payments and the same amounted to US$ 66,957.34/-.

Section 2(10) of the Companies Act, a company means a company as defined under Section 3. Section 3 defines a company under sub-Clause (i) to mean a company formed and registered under this Act or an existing company as defined in clause (2). Clause (2) pertains to existing companies which were incorporated under the earlier provisions pertaining to company matters.

A Single Bench of Justice Dharmesh Sharma observed that “In view of the above, while it is the opinion of this Court that the present winding up petition is maintainable against the respondent company, since these proceedings are still at a nascent stage and no substantive orders have been passed towards the winding up of the respondent company, it would be appropriate for the same to be transferred to the National Company Law Tribunal. “In this regard, it would be expedient to consider that during the pendency of the present petition the Insolvency and Bankruptcy Code, 2016 has been enacted, along with the introduction of Companies Act, 2013. It is necessary to consider Section 434 of the said Act, which provides for the transfer of proceedings relating to winding up, pending before High Courts, to the NCLT” the Tribunal he

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